Tires produced by the Chinese company are sold under the brand names Westlake, Telluride, Compass, and YKS. The Chinese company unilaterally changed the construction after its product passed federal tests without telling Foreign Tire Sales about the change. Foreign Tire Sales recognizes that a complete product recall might be in order and such a recall would force Foreign Tire Sales to file for bankruptcy. Tire failures will embroil carmakers including Ford Motor Co. and General Motors Corp. in additional lawsuits.
The company first suspected problems in October 2005. Almost a year later, in September 2006, Hangzhou Zhongce Rubber acknowledged that a gum strip that prevents the tread from separating was left out of the manufacturing process. Foreign Tire Sales did not alert the National Highway Traffic Safety Administration about the problems until June 11, 2007, claiming its officials had no definitive proof of a manufacturing flaw until it was revealed by further testing in May.
Also in May, Foreign Tire Sales was named as a defendant in a lawsuit where two workers were killed in a van roll over accident. The lawsuit contended that the accident was caused by tread separation in a Hangzhou Zhongce tire. Earlier in the year, an ambulance in New Mexico rolled over after a Hangzhou Zhongce tire came apart, though there were no significant injuries.